Labour Disputes
Texto da decisão
Decision of the Dispute Resolution Chamber
passed in Zurich, Switzerland, on 10 January 2008,
in the following composition:
Slim Aloulou (Tunisia), Chairman
Theo van Seggelen (Netherlands), member
Joaquim Evangelista (Portugal), member
Ivan Gazidis (USA), member
Reinhard Rauball (Germany), member
on the claim presented by the club
AAA, Xxx,
represented by Mr Xxx
as Claimant/Counter-Respondent
against the player
BBB, Xxx,
represented by Mr Xxx
as first Respondent/Counter-Claimant
and the club
CCC, Xxx,
represented by Mr Xxx
as second Respondent
regarding a dispute about an alleged
breach of an employment contract and the alleged inducement to
breach of an employment contract arisen between the parties involved
I.
Facts of the case
1.
On 9 June 2006, the Xxx club, AAA (hereinafter: the Claimant), lodged a claim at
FIFA against both the Xxx player, BBB (hereinafter: the first Respondent), for
unilateral breach of contract and the Xxx club, CCC (hereinafter: the second
Respondent), for inducement to such breach of contract.
2.
In particular, the Claimant argued that the first Respondent was found in breach
of contract since, despite the club’s reminder of 7 April 2006, he never showed
up to join the club as contractually agreed but signed a new employment
contract with the second Respondent on better financial terms.
3.
Therefore, in the first place, the Claimant claimed from the first Respondent
compensation for breach of contract in the total amount of USD 682’000,
corresponding to the remuneration, i.e. salaries and premiums, that the Claimant
would allegedly have been entitled to during the term of the contract, plus
default interest at a rate of 5% per year to be calculated on the basis of this
amount. Furthermore, the Claimant requested that disciplinary sanctions should
be imposed on the first Respondent.
4.
Secondly, the Claimant requested that the second Respondent should be deemed
jointly and severally responsible for the above-mentioned payments and that
disciplinary sanctions should be applied. In this regard, the Claimant stated the
second Respondent acted in bad faith with regard to the signing of the first
Respondent, since, on 16 December 2005, it explicitly informed the second
Respondent that the first Respondent had a valid contract with it and, therefore,
the signing of the first Respondent would contravene the FIFA Regulations.
5.
In support of its claim, the Claimant referred to a labour agreement, a so-called
memorandum, dated 15 November 2005, signed by itself, the Claimant, and the
first Respondent and valid from 1 February 2006 until 1 January 2007 as well as
an unsigned annex to the said agreement equally dated 15 November 2005. In
particular, the Claimant stressed that the agreement was duly signed by the
contractual parties, first by the first Respondent and at a later date by itself, the
Claimant.
6.
According to the wording of the above-mentioned agreement it was concluded
between the parties “for the player to render football activities as non-amateur
player for the club”. In clause 2 of the relevant agreement it is established that
the Claimant should pay the total amount of USD 400,000, payable in several
instalments, as basic remuneration to the first Respondent. Clause 4 of the
relevant agreement states that “in the case about the new articles and any
questions of the articles written for the memorandum, the club and the player
shall try to settle such questions through a meeting of understanding”. The
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Club AAA, Xxx / Player BBB and Club CCC, both Xxx
unsigned annex to the memorandum dated 15 November 2005 concerning the
“special remuneration and other remuneration mentioned in article 4 in the
contract” stipulates that the first Respondent is entitled to various premiums in
the total amount of USD 268,000 under the condition that the relevant payment
terms are met.
7.
In this regard, the Claimant pointed out that in accordance with the
jurisprudence of the Dispute Resolution Chamber the said agreement had to be
considered as a valid employment contract of a definitive nature and not as a
pre-contract, since it contained all the essential elements (esentialia negotii) of
an employment contract, in particular, the place of work, the period of validity
and the salary. In this respect, the Claimant stated that the absence of a penalty
clause was justifiable, since none of the parties had the respective protection of
such clause.
8.
Furthermore, the Claimant stated that the relevant agreement was meant to be
definitive, since there was no clause stipulating that the signing of a definitive
instrument would be necessary to legally bind the parties. In this respect, it
emphasised that in clause 4 of the agreement it was only established that the
parties should try to solve any dispute regarding the agreement by mutual
consent on the occasion of an eventual meeting.
9.
Moreover, the Claimant stated that in case that the agreement in question
should be considered as a pre-contract, which was strongly objected, it would
still represent a contractual commitment for the first Respondent to enter into
an employment contract with it, which has never been accomplished due to the
fact that the first Respondent signed with the second Respondent.
10.
Finally, the Claimant stated that, on 12 December 2005, based on the valid
employment contract the Xxx Immigration Authorities granted the first
Respondent a work permit.
11.
In its response, the first Respondent contested the existence of a legally effective
employment contract between him and the Claimant. In particular, the first
Respondent stated that at the moment when he signed the relevant agreement
it did not bear the Claimant’s signature, i.e. before the Claimant duly expressed
its formal consent by signing the agreement only he but not the Claimant would
have been obliged to comply with the agreement. Furthermore, the first
Respondent stated that subsequently he never received a copy of the signed
agreement. In this respect, he emphasised that in clause 5 of the agreement it
was clearly determined that “This memorandum has been prepared and
executed in duplicate and representative of the club and the player shall sign
them and keep one copy each”. Moreover, the first Respondent pointed out that
no penalty clause, protecting him from an eventual breach of contract by the
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Club AAA, Xxx / Player BBB and Club CCC, both Xxx
Claimant, was stipulated in the agreement. As a consequence, the first
Respondent argued that the agreement could not be considered as legally
binding.
12.
Furthermore, the first Respondent stated that, should the validity of the
agreement be established, it would have to be considered only as a pre-contract
or a financial proposal to him, the first Respondent, without any contractual
obligation on his, the first Respondent, side. In particular, he stressed that the
relevant document would only have legal effect as a definitive employment
contract if he accepted the Claimant’s proposal. In this regard, the first
Respondent emphasised that, on 14 December 2005, he had notified the
Claimant to disregard the allegedly “informal negotiations” that could lead to
an employment contract. Therefore, the first Respondent argued that the
relevant agreement in accordance with its clause 4 (cf. wording of the relevant
clause above) could only be considered as a valid employment contract under the
condition that additional provisions were included, which never happened.
13.
On account of the above, the first Respondent concluded that he never
committed a breach of contract and, thus, he had the right to sign a new
contract with the second Respondent.
14.
Moreover, the first Respondent/Counter-Claimant (hereinafter: the first
Respondent) lodged a counter-claim against the Claimant/Counter-Respondent
(hereinafter: the Claimant). In particular, he requested the total amount of USD
682’000 plus default interest at a rate of 5%. In this respect, the first Respondent
argued that the Claimant failed to enter into further negotiations in order to
formalize a definitive employment contract as provided for in the relevant
memorandum despite having been invited to do so by him, the first Respondent,
on 11 April 2006. Therefore, the first Respondent was of the opinion that he had
just cause to breach any contractual relationship that could ever have existed
between him and the Claimant.
15.
In its response, the second Respondent also contested the existence of a valid
employment contract between the first Respondent and the Claimant due to the
fact that the relevant agreement, taking into consideration the wording of its
clause 4, could not be understood as a definitive contract but only as a
preliminary contract.
16.
Furthermore, the second Respondent argued that the Claimant did not duly sign
the relevant memorandum and, therefore, the memorandum was in no case
legally binding. Moreover, it stated that that the first Respondent, on 14
December 2005, notified the Claimant that it should disregard the previous
negotiations. In this regard, the second Respondent emphasised that the
Claimant did never insist on the conclusion of a definitive contract including all
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Club AAA, Xxx / Player BBB and Club CCC, both Xxx
the required contractual provisions and clauses but, on 7 April 2006, only asked
the first Respondent to accomplish the employment contract allegedly
concluded.
17.
Finally, the second Respondent argued that it had not induced the first
Respondent to breach any contract due to the fact that it had signed the first
Respondent for the year 2006 in good faith. In particular, the second Respondent
stated that the first Respondent, upon its request of 20 December 2005, on 27
December 2005 had confirmed that he was a “free agent”, i.e. that he had not
signed a contract with the Claimant, and that he would be liable in case of any
dispute arising in this regard.
18.
With regard to the first Respondent’s counter-claim the Claimant referred to its
previous position. In particular, it emphasised that it was contradictory to
consider the relevant agreement at the same time as “promise to a contract”
and as “financial proposal” or “informal negotiations”.
II.
Considerations of the Dispute Resolution Chamber
1.
First of all, the Dispute Resolution Chamber had to analyze whether it was
competent to deal with the matter at stake. In this respect, it referred to art. 18
par. 2 and 3 of the Rules Governing the Procedures of the Players’ Status
Committee and the Dispute Resolution Chamber. The present matter was
submitted to FIFA on 9 June 2006, as a consequence the Chamber concluded that
the revised Rules Governing the Procedures of the Players’ Status Committee and
the Dispute Resolution Chamber (edition 2005, hereinafter: the Procedural Rules)
to matters pending before the decision making bodies of FIFA are applicable to
the matter at hand.
2.
With regard to the competence of the Chamber, art. 3 par. 1 of the Procedural
Rules states that the Dispute Resolution Chamber shall examine its jurisdiction in
the light of articles 22 to 24 of the 2005 edition of the Regulations for the Status
and Transfer of Players. In accordance with art. 24 par. 1 in combination with art.
22 b) of the aforementioned Regulations, the Dispute Resolution Chamber shall
adjudicate on employment-related disputes between a club and a player that
have an international dimension.
3.
As a consequence, the Dispute Resolution Chamber is the competent body to
decide on the present litigation involving, on the one hand, a Xxx club and, on
the other hand, a Xxx player and a Xxx club regarding the alleged breach of an
employment contract and the alleged inducement to such breach of contract.
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Club AAA, Xxx / Player BBB and Club CCC, both Xxx
4.
Subsequently, the members of the Chamber analyzed which edition of the
Regulations for the Status and Transfer of Players should be applicable as to the
substance of the matter. In this respect, the Chamber referred, on the one hand,
to art. 26 par. 1 and 2 of the 2005 edition of Regulations for the Status and
Transfer of Players in accordance with FIFA circular no. 995 dated 23 September
2005 and, on the other hand, to the fact that the relevant labour agreement at
the basis of the present dispute was signed on 15 November 2005 and the claim
was lodged at FIFA on 9 June 2006. In view of the aforementioned, the Chamber
concluded that the 2005 edition of the Regulations for the Status and Transfers
of Players (hereinafter: the Regulations) is applicable to the case at hand as to
the substance.
5.
In continuation, and entering into the substance of the present matter the
Chamber acknowledged the documentation contained in the file, and in view of
the circumstances of the matter at stake, focused its considerations on the
question as to whether an unjustified breach of the labour agreement, signed by
and between the Claimant and the first Respondent occurred and, in the
affirmative, which party is responsible for such breach of contract.
6.
As far as the question as to whether a breach of contract occurred is concerned,
the Chamber started by acknowledging that the Claimant and the first
Respondent, on 15 November 2005, signed a labour agreement, a so-called
memorandum, which was to be valid from 1 February 2006 until 1 January 2007.
7.
In this respect, the members of the Chamber took note of the first Respondent’s
objections according to which he never considered himself contractually bound
to the Claimant. In particular, the Chamber took note that the first Respondent
contested the existence of a valid employment contract between him, the first
Respondent, and the Claimant. In this regard, the Chamber acknowledged that
the first Respondent argues that at the moment when he signed the agreement
in question the Claimant had not yet signed it, that he never received a copy of
the relevant agreement and that no penalty clause was stipulated in the said
agreement.
8.
Furthermore, the Chamber observed that the first Respondent states that, should
the validity of the said agreement be established, it would have to be considered
only as a pre-contract or a financial proposal to him, the first Respondent, which
would only have legal effect as a definitive employment contract given that he
accepted the Claimant’s proposal and additional provisions were included in
accordance with clause 4 of the contract.
In this context, the Chamber also noted the second Respondent’s statements in
support of the position submitted by the first Respondent. In particular, the
Chamber took note that the second Respondent equally contested the existence
of a valid employment contract between the first Respondent and the Claimant
9.
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Club AAA, Xxx / Player BBB and Club CCC, both Xxx
due to the fact that the relevant agreement in accordance with the wording of
its clause 4 could not be understood as a definitive contract but only as a
preliminary contract, which was not duly signed by the Claimant.
10.
Considering the above arguments raised by the first and the second Respondent,
the Dispute Resolution Chamber concluded that these statements do not speak
against the validity of the relevant agreement. In fact, the Chamber held that
the said agreement appears to have been duly signed by and between the
Claimant and the first Respondent and that it comprises all essential elements
necessary for a contract to be considered as validly concluded, i.e. all the
“essentialia negotii” such as the place of work, the period of validity and the
salary, etc. In this respect, the Chamber particularly acknowledged that the
agreement in question stipulates that the first Respondent shall render his
services as a professional to the Claimant, that the Claimant has to pay a basic
remuneration in the total amount of USD 400,000 to the first Respondent and
that the term of the contract is to last from 1 February 2006 until 1 January 2007.
11.
In this regard, the Chamber pointed out that the penalty clause missing is not an
essential element for the validity of the contract. Furthermore, the Chamber
stated that the fact that the first Respondent alleges not having received a copy
of the relevant agreement does neither concern the validity of the agreement.
Moreover, with regard to the order of the parties signing the agreement, the
Chamber emphasized that one of the parties has to sign the agreement first and,
therefore, it was irrelevant that in casu the Claimant appears to have signed the
agreement after the first Respondent.
12.
Finally, the Chamber deemed it also appropriate to mention that, according to
clause 4 of the relevant agreement, only in case that there are additional articles
to be included in the agreement further negotiations between the contractual
parties are required. However, the Chamber emphasised that the said clause 4
does not establish any obligation to include additional articles in the agreement.
In this respect, the Chamber referred to the wording of clause in question which
explicitly states that “in the case about the new articles and any questions of the
articles written for the memorandum, the club and the player shall try to settle
such questions through a meeting of understanding”.
13.
In conclusion to the aforementioned, the Chamber held that the agreement
dated 15 November 2005, submitted to the file, and signed by the Claimant and
the first Respondent has to be considered as valid and legally binding and,
therefore, the arguments raised by the first and the second Respondent related
to the alleged invalidity of the agreement cannot be accepted.
14.
In this regard, the Chamber acknowledged that the annex, equally dated 15
November 2005, concerning “special remuneration and other remuneration
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Club AAA, Xxx / Player BBB and Club CCC, both Xxx
mentioned in article 4 in the contract” was not signed by each of the contractual
parties and, consequently, cannot be taken into consideration.
15.
Furthermore, the Chamber took note of the undisputed fact that the first and
the second Respondent signed an employment contract for the year 2006.
16.
In view of the above, the Dispute Resolution Chamber emphasized that, as a
general rule, the signing of an employment contract by a player with a new club
that starts to run before the employment contract between the player and his
former club expired or was prematurely terminated by mutual agreement is to
be considered as a breach of contract.
17.
The members of the Chamber held that the first Respondent was unable to
prove that he got the approval of the Claimant to enter into a new employment
contract with another club, i.e. the second Respondent, or that he had just cause
to terminate the contract with the Claimant. In this respect, the Chamber
established that the fact that the first Respondent, on 14 December 2005,
allegedly declared that the Claimant should disregard the “informal
negotiations” and that the Claimant only on 7 April 2006 asked the first
Respondent to accomplish his contract, i.e. two moths after the contract came
into force, did not constitute a valid reason for its termination.
18.
As a result of the above, the Dispute Resolution Chamber came to the conclusion
that by signing an employment contract with the second Respondent, the first
Respondent had breached the labour agreement binding him to the Claimant.
The members present at the meeting recalled that the first Respondent neither
had the approval of the Claimant to sign an employment contract with the
second Respondent nor did he invoke a valid just cause before the Chamber for
having not assumed his duties under the employment contract he entered into
with the Claimant.
19.
In this respect, the Chamber drew the parties’s attention to the contents of art.
18 par. 5 of the Regulations, according to which, in case a Professional enters
into more than one contract covering the same period, the same provisions
concerning the consequences of terminating a contract without just cause apply.
The Chamber held that such provision fully applies to the case at stake, whereby
the first Respondent concluded an employment contract with the second
Respondent while being under contract with the Claimant.
20.
The Chamber therefore unanimously reached the conclusion that the first
Respondent was found to be in breach of contract.
21.
Having established that the first Respondent had breached the employment
contract with the Claimant without just cause, the Chamber turned to art. 17
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Club AAA, Xxx / Player BBB and Club CCC, both Xxx
par. 1 of the Regulations, according to which in all cases the party in breach shall
pay compensation, and proceeded to deliberate on the question of the amount
of compensation for breach of contract which the first Respondent is liable to
pay to the Claimant.
22.
In this respect, the Chamber referred to the aforementioned considerations, the
behaviour of the parties concerned in the matter at stake whilst also taking into
account the contractual value amounting to USD 400,000 as well as the request
for compensation submitted by the Claimant in the amount of USD 682,000.
23.
Thereto, the members of the Chamber deemed it appropriate to recall that the
Claimant only asked the first Respondent to resume duty with it on 7 April 2006,
i.e. two months after the contract came into force. Therefore, the Chamber put
emphasis to the fact that the Claimant apparently did not incur any particular
damage due to the fact the first Respondent did not resume duty with it.
24.
The Chamber considered these facts as mitigating circumstances with regard to
the amount of compensation for breach of contract which the first Respondent is
responsible to pay.
25.
In view of the above, the members of the Chamber reached the conclusion that,
on account of the circumstances surrounding the present case as well as the
criteria established in art. 17 par. 1 of the Regulations, the payment of
compensation in the amount of USD 150,000 by the first Respondent to the
Claimant appears to be appropriate.
26.
In continuation, the Chamber added that, in application of art. 17 par. 2 and art.
18 par. 5 of the Regulations, the second Respondent is jointly and severally liable
for the payment of the relevant compensation towards the Claimant in the
amount of USD 150,000.
27.
Finally, with regard to the first Respondent’s counter-claim whereby he requests
compensation in the amount of USD 682’000 for breach of contract allegedly
committed by the Claimant, the Chamber referred to its above-mentioned
conclusion that the first Respondent is found in breach of contract without just
cause (cf. point II. 20). Furthermore, the Chamber emphasised that the first
Respondent’s position with regard to the nature of the agreement was
contradictory. In particular, the Chamber acknowledged that the first
Respondent, on the one hand, considered the agreement as informal
negotiations without any legally binding effect and, on the other hand, argued
that the Claimant failed to fulfil its obligation to enter into further negotiations
in order to formalize a definitive employment contract as allegedly provided for
in the relevant agreement. As a consequence, the Chamber decided that the first
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Club AAA, Xxx / Player BBB and Club CCC, both Xxx
Respondent’s counter-claim is completely ungrounded and has therefore to be
rejected.
28.
Taking into account all the above, the Dispute Resolution Chamber decided that
the first Respondent has to pay to the Claimant the amount of USD 150,000, as
well as 5% interest per annum on the said amount as of the filing of the
Claimant’s claim, i.e. 9 June 2006, and that the second Respondent is jointly and
severally liable for the payment of the aforementioned amount of
compensation. Finally, the Chamber decided to reject all further claims of the
parties.
III.
Decision of the Dispute Resolution Chamber
1.
The claim of the Claimant, AAA, is partially accepted.
2.
The first Respondent, BBB, must pay compensation in the amount of USD
150,000, as well as 5% interest per annum on the said amount as of 9 June 2006,
to the Claimant, AAA, within 30 days as from the date of notification of this
decision.
3.
In the event that the above-mentioned total amount is not paid within the
stated deadline, the present matter shall be submitted to FIFA’s Disciplinary
Committee, so that the necessary disciplinary sanctions may be imposed.
4.
The second Respondent, CCC, is jointly and severally liable for the payment of
the amount mentioned under point III.2. to the Claimant, AAA.
5.
The Claimant, AAA, is directed to inform the first Respondent, BBB, and the
second Respondent, CCC, directly and immediately of the account number to
which the remittance is to be made and to notify the Dispute Resolution
Chamber of every payment received.
6.
Any further requests of the Claimant, AAA, are rejected.
7.
The counter-claim lodged by the first Respondent, BBB, is rejected.
8.
According to art. 61 par. 1 of the FIFA Statutes, this decision may be appealed
against before the Court of Arbitration for Sport (CAS). The statement of appeal
must be sent to the CAS directly within 21 days of receipt of notification of this
decision and shall contain all the elements in accordance with point 2 of the
directives issued by the CAS, a copy of which we enclose hereto. Within another
10 days following the expiry of the time limit for filing the statement of appeal,
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Club AAA, Xxx / Player BBB and Club CCC, both Xxx
the appellant shall file a brief stating the facts and legal arguments giving rise to
the appeal with the CAS (cf. point 4 of the directives).
The full address and contact numbers of the CAS are the following:
Court of Arbitration for Sport
Avenue de Beaumont 2
1012 Lausanne
Switzerland
Tel: +41 21 613 50 00
Fax: +41 21 613 50 01
e-mail: [email protected]
www.tas-cas.org
For the Dispute Resolution Chamber:
Jérôme Valcke
Secretary General
Encl. (CAS directives)
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Club AAA, Xxx / Player BBB and Club CCC, both Xxx